Looming Limits

Bill Newman of Research Capital points out the potential for a peak in production...

Wall Street Journal - Oil Officials See Limit Looming on Production

Many top oil executives are predicting a global oil production plateau of 100 million bbl/d by 2012.

Global production is restricted not by reserves, but by access to reserves, increasing costs and limited labour force.

High oil prices are promoting non conventional oil production, such as oil sands or oil shale, but these projects take time to develop and are expensive.

Mature oil fields are declining. At least 4 million bbl/d of new production is needed just to keep production flat, every year.

The evidence forpeak oil or the plateau global oil production seems to be mounting. If itmaterializes then today's current record high oil prices will look like abargain. To capitalize on the potential for record high oilprices we recommend buying oil weighted producers. Werecommend buying Winstar for its near term production growth of longlife light oil assets in Tunisia. Buy Pan Orient for its light oilproduction growth from a potential large oil filed locatedonshore Thailand, and buy Antrim for its North Sea oilproduction expected to be approximately 30,000 bbl/d by mid to late2009.